Better use of $300k in SF Bay Area

[Sam Josh]

Hello BP, What is a better use of $300k in the Bay Area? Option 1: Scour for a rental property with positive cash flow. Hard to do but there is always hope. Option 2: Invest in adding extra space in primary home. The quotes are for $300 per sq feet in construction costs to add space. Homes in the area are selling for $1000 or more per square feet. If the idea is to increase net worth option 2 looks better. Not to mention the joy of living in a bigger upgraded home. But that’s just my simple brain thinking. What do the gurus on the forum think?

[Robert C.]

@Sam Josh, If you're going to keep your money in the Bay Area, I would only put it in your primary home if you plan to sell right after the renovation. That's how you get the best bang for your buck. Even though you might be improving the value of your house, you're not seeing any return so long as you're occupying/enjoying the space. 

If you just want to enjoy a bigger space that's fine, but don't think of it as an investment decision.